Reinvention Hardware

The world of retailing is filled with some astonishing tales of stores being reinvented, transforming themselves into entirely different species.

Banana Republic started life selling safari jackets in funky jungle-like locations with jeeps crashing through the front window until it turned to metrosexual ware. Before Marvin Traub & Co. arrived, Bloomingdale Brothers was a low-end discount department store where the Little Brown Bags were little brown bags.

And Abercrombie & Fitch used to cater to the adventurer crowd who wouldn’t know the difference between a Cosmopolitan and a cosmetologist.

To that list, Gary Friedman is in the process of adding Restoration Hardware.

What began as an eccentric version of a local hardware store founded by Stephen Gordon in the early 1980s in Eureka, CA is now arguably the most watched retailer of home furnishings in the country.

And now Friedman wants to take that transformation one step further: He wants to be the next Ralph Lauren.

But, wait, we’re getting ahead of our story. A little history first.

Resto – that’s what everybody in the trade calls it – evolved from that single store into a chain of close to 100 units by the late 1990s, going public in the process.

The merchandise was a slightly bizarro collection of mission furniture, kitchen gadgets, cleaning supplies, and nostalgia-ridden toys and gewgaws.

And it didn’t work.

Expensive real estate in fancy malls, low average tickets dominated by $6 gadgets and a wildly inefficient footprint spread out all over the place drove the stock into the toilet and the profits went to…well, you can follow this metaphor, I’m sure.

Eventually Gordon phased out/was phased out, landing at Robert Redford’s Sundance Catalog, where he remains today.

Enter Gary Friedman. The long-time number two at Williams Sonoma, he was generally credited with creating the modern Pottery Barn, the one that influenced the home business in the 1990s more than any other single retailer in America.

He was also credited with being never able to get his boss Howard Lester to hand over the corner office at WS.

Friedman moved across the bay from Sonoma’s offices to Resto’s, and in fact overlapped with Gordon for a short time, a pairing that no doubt was as uncomfortable as it looked to outside observers.

After Gordon’s exit, Friedman did a little of this and a little of that but it didn’t add up to a whole lot. Resto went private, which was a good thing because it hadn’t made any money since the invention of the metric wrench. For a few minutes, Fast Eddie Lampert of Sears circled, threatening to buy Resto, seemingly to have it do for home what Lands End was supposed to be doing in fashion.

Finally, come around 2008 when the bottom fell out of the world, Friedman decided to go for broke. Out went the doodads and metal cleaners. Next went the mission furniture, to be replaced by a curious mix of vintage inspired dressers and couches in recycled wood and antiqued leather.

While every retailer in the country was in a mad rush to trade down, Friedman went the other way. “If we’re going to go out, we’re going to go out in style,” Friedman told me in an interview at the reopening of the Flatiron store in Manhattan, the first unit to fully embrace the new look.

The reinvention of Resto was on its way.

That process reached its next level just a few months ago with the opening of the company’s Los Angeles flagship on the west side near both the Beverly Center and the home district adjacent to the Pacific Design Center.

As an extra little ironic bonus, the store is housed in the failed flagship of the Williams Sonoma Home chain created by one Howard Lester. I’m sure that had absolutely nothing to do with the site selection process.

Not that you would recognize any similarities between the former and the latter. The Resto store is painted dark gray and is entered through a courtyard that used to be the parking lot for the previous tenant.

Inside is the latest iteration of the Resto look: More vintage wood, aged leathers, reproduction decorative accessories, some one-of-a-kinds and, at least for the holidays, a broad selection of grab-and-go gifts and items that capture the spirit of the original Restoration product mix.

The store is magnificent, brilliantly merchandised, and skillfully decorated. From over-scaled wall clocks and six-foot tall Eiffel Tower replicas to aluminum desks and chairs authentic right down to the riveting, the store is the most evocative single voice in home right now.

But wait, there’s more. As Resto gradually winnows down its store count concentrating on larger, destination-driven flagships, it has stepped up its direct sales effort with slick catalogs the size of medium-sized city Yellow Pages and an increasingly sophisticated website that takes a backseat to nobody in home.

And that’s where you’ll find Gary Friedman’s Ralph Lauren persona. The new catalogs feature a heavily romanticized portrait of Friedman along with a healthy assortment of Friedspeak, philosophical meanderings and quotations on taking the home road less traveled. Ralph couldn’t have said it better himself.

The transformation of Resto is, if not completed, certainly dramatic. Which raises the question of what’s next.

Already, every home retailer and supplier in the space – from Target to Macy’s and even to a little operation called Pottery Barn – has jumped on the Resto look much as everyone jumped on the Pottery look in the 1990s. Talk about reproduction.

In the meantime the company investors announced last fall they were considering taking Resto public and released some numbers that showed it making money, a sight as rare as some of the one-of-a-kinds on the selling floor.

Can Friedman continue to keep Resto one step ahead of everybody else? Can he keep the Ralph thing going long enough to become a household name? Will it go public again and fall prey to short-term stockholders who don’t want to hear about long-term strategies?

Most importantly, perhaps, can Gary Friedman prove that Resto is not a one-trick pony and that it can continue to reinvent itself to fit the times?

Don’t bet against him. After all, he’s got just the right Hardware for the job.